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- The bank advised investors to consider Bitcoin in their portfolio since the crypto winter has already ended and the spring is at hand awaiting the halving event around April next year.
- Without issuing a long-term price target, Morgan Stanley expects Bitcoin price to rally beyond its ATH after the halving event next year based on past performance that has repeated severally in the past bull rallies.
Morgan Stanley, an American multinational investment bank and financial services company with more than $1.3 trillion in assets under management (AUM), recently sent a note to its clients explaining the best entry timing for the next crypto bull season.
Notably, Morgan Stanley analysts split the crypto trading cycle into four seasons that are marked by the Bitcoin halving event that is programmed to counter its inflation and reward the holders.
Bitcoin (BTC) was developed to help investors fight the ever-rising global fiat inflation and ultimately revolutionize the global payment system that has locked out most of the retail investors.
According to serial investor and author of Rich Dad Poor Dad Robert Kiyosaki, Bitcoin price is on the verge of rallying towards $135k soon fueled by the high global inflation. The long-term prosperity of Bitcoin is largely supported by the high definitive supply against ballooning demand. Notably, on-chain data provided by Santiment shows long-term holders with a Bitcoin balance of between 1 and 10k hold about 15 million coins out of 21 million.
Morgan Stanley on Bitcoin Investment Cycles
According to the investment bank, the cryptocurrency market has established four seasons – summer, fall, winter, and spring – in its historical cycle that is differentiated by the Bitcoin halving. Notably, the Bitcoin halving takes place after every 210k blocks are successfully mined, which is estimated to take place every four years.
The investment bank is confident Bitcoin will continue to influence the crypto market due to its high market dominance which stands around 52 percent following the recent rally above $30k. The bank noted.
By intentionally limiting the supply of new bitcoin, the shortage caused by the halving can affect the price of bitcoin to potentially spur a bull run. There have been three such runs on Bitcoin since its inception in 2011, each lasting 12 to 18 months after the halving. Just as a farmer avoids planting seedlings in the winter or too late in the spring, crypto investors want to know when crypto spring has arrived to maximize their investment ‘growing season.
Notably, the bank told its clients that the crypto spring is in hand although the analysts cautioned that the past performance does not always predict the future. One of the signs that a macro crypto bull market is on the horizon is the notable increment in the mining difficulty as more miners compete to get rewarded in every block. Coupled with the fact that Bitcoin price has gained more than 70 percent YTD, Morgan Stanley is confident more upside momentum will be sustained in the coming quarters.
